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I was doing some research in the Time Magazine archives (the best ones I have seen, by the way) the other day and came across this nugget from 1962:

“Despite the discouraging results so far, many scientists argue that military-space research will ultimately produce an overflowing cornucopia of marketable consumer products, from supersonic planes to small nuclear reactors for home power.”

State of Business: Where Are the Tinkerers? September 21, 1962

Take note of the date. Supersonic planes for commercial travel became a reality with the Concord, an Anglo-French construction that operated between New York or Washington and Paris or London for many years until airframes started to fatigue and the small fleet was retired. Supersonic travel never really caught on. Airlines have gone in the other direction since then electing to buy big cattle cars for the masses rather than supersonic hotrods for the elite.

It makes perfect sense too given the rise of civilian aviation and private planes over the years and people’s refusal to hear sonic booms whenever a plane flew over. But in ’62, who knew? And that’s the point about prognostication, especially when you don’t rely on research to provide an inkling of what’s even possible or what other factors might have an impact. That’s best seen in “small nuclear reactors for home power.” In a society where people can’t be depended on to do the right thing when disposing of an old TV or refrigerator, small nukes simply offer the real possibility of a million Chernobyls.

What the Time article didn’t even hint at was the possibility of having small computers for home and personal use or what that might mean. They couldn’t even imagine that but they are not to be blamed. It’s human nature to think that tomorrow will be just like today in all its particulars and that’s one reason why we are so bad at making predictions.

With that in mind we turn to the new year and prognostications about what might happen in our tiny corner of reality, CRM. Here are my thoughts.

Gamification will continue to gain interest as some people figure out how to avoid the crash that Gartner predicted when it said that 80 percent of gamification projects would fail by 2014. The key will be understanding the difference between gamified tasks at work and work as a game. See?

Cloud computing will continue being adopted by enterprises. The version of cloud that will be popular will involve moving the data center off site, not in fundamentally reorienting enterprise apps to face modern customers and users. We are still in the early phases of adoption of this kind of cloud, which is best thought of as Infrastructure as a Service (IaaS). Disenchantment is still a year or two off but it will happen.

Back office applications will accelerate their migration to the front office. We’ve seen billing and payments move much closer to the front office with products like Zuora making them part and parcel of the subscription economy. But also, human resources applications like Work.com from Salesforce are also moving historically back office HR functions to the front office. This will continue as other companies get into the act. Eventually I expect to see many more customers interacting with raw material suppliers through vendor sites.

Robotics invade the front office. Companies like VirtuOz produce Intelligent Virtual Agents (IVA’s) that replace people in many routine customer service functions like triage or even whole transactions. IVA’s aren’t perfect but they can speed up the customer service process and they can be deployed 24/7 for consistent service. Sometimes all you need is a robot to get something done and IVA’s will help segment the market and preserve human agents for more complex situations.

Analytics will continue its land-and-expand mission. It started with sentiment analysis, which has proven to be useful but there is so much more to be done. Applying analytics to segmentation, influence and other more fine grained listening is not that hard. Once you have an analytics engine the next piece is scoring and submitting the scores for analysis. Scoring algorithms will therefore proliferate and the roll out of additional analytics ought to accelerate, bringing more refined ways of filtering big data.

There is a hardware revolution going on that almost no one is attending to, partly because gear has become so commoditized at the personal end that we think of it as another appliance but also, so geeky at the main server end that few of us comprehend it. But make no mistake about it gear is where innovation is at a fever pitch. No gear, no social, no analytics, no cloud. No kidding. Devices that speed up data handling through in-memory (SAP and Oracle come to mind) databases, massive storage arrays with solid state drives, and sophisticated analytics to take advantage of all this, are in market. This is another land and expand situation where landing has been ongoing so look for the expansion to get into high gear next year.

CRM continues to melt like a jellybean on a summer sidewalk. Everything continues to come together and the appeal of silo-ed sales and marketing applications continues to wane along with interest in desktop PC’s. What replaces them is the holistic CRM database shot through with social and analytics for anytime decision-making and continuous buying. CRM is not going away and neither is the jellybean, we’re just making soup.

The cost of energy is beginning to affect front office business and we can see it in several ways. Transportation is becoming costly for manufacturers who are beginning to move production closer to customers (think HP and Apple for starters). Transport costs and travel in general will affect the front office too so look for credible alternatives such as video calling embedded in front office apps. This is another technology already in market and ramp up will not be difficult.

That’s enough. Hopefully none of this rises to the level of a small nuke for the home but if it does I will be back here next year to walk it all back.

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This week Zach Nelson, CEO of NetSuite, a.k.a. Larry’s other company, took over the Marc Benioff chair as guest antagonist but given the relationship between the companies the vibe was more sedate. For instance, no one went to the talk at the Lam Theater in Yerba Buena Gardens wondering if Nelson would be controversial or if he would utter the words, “We come in peace,” as Benioff once had. That much was a given.

Nonetheless, Nelson served roughly the same purpose as Benioff; he was the emissary from the cloud. He functioned as a third party thought leader pointing off in a future direction that Oracle itself could not for various reasons. Nelson’s direction and his talk cemented one of the key elements of cloud computing for large enterprises contemplating — what to do about the growth of increasingly expensive and hard to maintain ERP systems. In an era where data and decision-making are continuously being pushed down the chain of command conventional on premise ERP has a flexibility problem and that was the subject of Nelson’s talk.

For at least the last year various vendors have been talking about their two tier strategies in which they provide a second layer of ERP support or they cooperate with other vendors to do so. Nelson used his time to describe the advantages of using a product like NetSuite in a variety of ways that demanded a second tier of ERP.

For instance, a large multi-national company might use a second tier of ERP systems to capture local or regional data, convert currencies and adhere to local regulations before rolling the results up to corporate in a more tidy bundle. The two tiers could in practice be all NetSuite but Nelson’s point was to also support heterogeneous environments in which Oracle or SAP might be the corporate standard.

Finally, an question that is on lots of minds during a merger, acquisition or sale of a division is what to do about the financials. I have to confess that this is not top of mind for me but I can understand how it can be for the principals. Nelson’s point is that his product, by virtue of its cloud residency, can spin up a company very quickly and enable the separation or merger as the case may be.

The two tier strategy is a happening thing and I expect that we will hear more about it over time and not just from ERP vendors. Much the same argument could be made for front office conversions. As multiple conventional CRM systems begin to age out we might see SaaS CRM vendors trying to ease the transition for their own products.

Finally, two tier provides other benefits to companies such as limiting the growth of conventional ERP and initiating a transition that will move some to the cloud eventually and away from big ERP systems. That’s what Oracle can’t say on its own because as much as it would like to surround SAP systems with NetSuite and eventually convert them, it would not like to see the same thing happen with, say, Microsoft ERP surrounding and ultimately ejecting Oracle from an account. NetSuite has an inside track right now because it runs a complete Oracle stack which will make conversion easier while keeping it all in the family.

Zach Nelson’s talk was a success. He presented an appealing vision of ERP in the cloud and for that I think it’s a lock that he’ll be invited back.

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Today, we’ve added the latest exchange between me and Elvis, a diehard Apple fanboy who would do anything to avoid the idea that his beloved Apple has done a not so good thing in failing to provide an alternative to downloading Mountain Lion. Does Apple have an obligation to serve all of its customers with alternative paths to the upgrade? I think so, but Elvis doesn’t.

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I honestly thought I was going to have to wait longer to hear anyone from Oracle talk about seriously focusing the company’s hardware and software lines on the Cloud. True, they’ve been saying cloud-like things for a couple of years but the pronouncements were features and functions that added something to the cloud discussion without going “all in” as some others in the industry have said. But last night CEO Larry Ellison did what I’d forecasted last week in a way that is uniquely Oracle but nevertheless a good, defensible (and somewhat debatable) position.

It seems this family of hardware (Exa-hardware) is built and optimized for very big jobs involving terabytes of data and gazillions of users. That’s exactly the kind of stuff the growing cloud computing movement might gobble up. Currently data centers are masses of commodity servers in racks running feverishly but without a layer of sophisticated management that would optimize their utilization and reduce costs…

And,

The next logical step would be to endorse the Exa-hardware as a sustainability tool for a power hungry planet. I’m looking for some sustainability messaging from Oracle and it could even happen…

And,

Sustainability is not alien to ideas like mobility, cloud, social and analytics, you can’t separate them. I think if Oracle wants to maintain its leadership position with many of the largest companies in the world, it needs to put a stake in the ground and become a thought leader here…

So last night, Ellison took aim at the cloud and announced Oracle 12c a database for the cloud that supports multitenancy, if you want it, and he announced the Oracle Private Cloud running on Exa-hardware and delivered as a tight bundle to customers who want to get to the cloud, simplify their lives, and not fret about managing all that stuff. He also announced Exadata 3, which can hold up to 26 TB of data – “All your databases.” The cool thing about Exadata 3 is that the 26 TB is all silicone based memory, it doesn’t count the spindles that are rapidly becoming secondary in a high performance enterprise environment.

He made some traditional arguments about the cloud being more efficient and economic and at some points came close to claiming credit for inventing it. Truth is he did have a hand in inventing modern cloud computing as a very early investor in Salesforce and NetSuite and as the Zen master for Benioff and Nelson. But his skin in the game had been relatively minimal.

Now, while there is plenty to like from a sustainability perspective, it should be acknowledged that what got announced is a bunch of half steps designed to get enterprise data centers into the cloud without much disruption. I think this means that Oracle, for the moment (which will be about a decade) will not be aggressively selling the virtualization that comes with multitenancy and as a result there will still be a great deal of wasted power and underutilization in some cloud data centers.

But in a decade we could see a switch flip and everyone will get religion about power consumption and pollution and the switch to virtualization will happen very quickly because some very large companies will have been prepositioned for the change.

Actually a decade might be a long time and 6 or 7 years might be more like it simply because Oracle has many competitors going to the cloud, most notably Salesforce, and that will accelerate the timetable.

The next step, which has to come this week, will be for the company to shift gears to software – cloud based software – that makes the cloud even more attractive. Look for this to happen especially in the CX Summit or whatever they are calling it, on Wednesday. That will be the day that Anthony Lye talks a lot about how the companies he bought last year – like RightNow and ATG and others – are making the Oracle cloud a serious competitor.

Achilles’ heel is still Fusion. What’s up with Fusion?

Finally, many, if not most of the big cloud computing companies are running fault tolerant data centers using conventional racks of blade servers and disks. That’s giving us 3 to 4 9’s of reliability but I think before we can hope to get to the 7 to 9 9’s that will make cloud truly ubiquitous and universal utility grade computing we’re going to need some re-architecting. Regardless of what you might think of Oracle’s approach to the cloud, the hardware is an appealing approach for that alone.

Oracle likes to message that 20 out of 20 of the top banks/pharmaceutical companies/whatever, use Oracle and it wouldn’t surprise me if they’re going for 10 of the 10 biggest cloud companies. That will take some work and given the multiple levels of competitiveness and lack of love between the players, that might take even more than a decade to happen.

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Are you kidding me? Apple has outsourced operating system product delivery to third parties of dubious expertise, though with good intentions, I am sure. Apple recently released Mountain Lion the latest version of their operating system for the Macintosh family. That’s the good news. I tried installing it and didn’t like what I found out. Consider this:

They don’t sell a disk of any kind that you can install in a conventional manner; you have to download the OS install file from the App Store and do the installation yourself.

It takes FOREVER to do the download. People are saying the download takes hours. Seriously?!

People are complaining about their computers’ performance afterward.

I understand the value of SaaS and of downloading things from the Web and I endorse the idea (read my blog), but this is one of those things best not done over the Web. The net has become a forest of solutions for slow downloads. There are actually do-it-yourself instructions from third parties describing the process of making your own DVD or flash drive for easier installation. Again, are you kidding me? I gotta tell you, I did not sign up for this! If you, Apple, want me to use your stuff, you need to make a reasonable effort to sell and deliver it to me. As a vendor, that’s your responsibility. A nice DVD would be a good place to start. This nonsense is unbelievable and unacceptable.

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All right! Recess is over! If you went to Dreamforce last week you can be forgiven for taking a kind of victory lap in your head today because it was a truly great experience, besides if you are like me you are still tired. One reason I think so many people like Dreamforce is its relentless focus on the future and on what will likely become standard practice in the not too distant future. But also, if you went to the keynotes from M.C. Hammer to Colin Powel to Richard Branson to Tony Robbins, you left San Francisco with a certain “lightness of being.”

However, if you are an analyst you need to put all of that behind you and get ready for Oracle OpenWorld (OOW), which promises to be a barn burner for its own reasons. Same city, same Moscone Center, same closed Howard Street, similar large crowd — where Dreamforce was all about the social enterprise, OpenWorld is about a lot that might not be so clearly connected. There’s hardware and operating systems and then software for the back office, front office, databases, middleware, and development tools. There are things I’m leaving out too like the America’s Cup. At OOW Oracle will provide a glimpse of its own into what the future looks like for the enterprise and in some ways it’s very different from what Salesforce is talking about and in some ways they are similar.

This is not to say that one vision is less good than the other, far from it. The competing visions reflect different world views and different realities. For instance, while Salesforce approaches things from a clean slate perspective, Oracle takes the view that what it introduces has to work with what delivered before. You can see this in its disciplined approach to supporting customers of the companies it bought way back in 2005.

Companies like Siebel and PeopleSoft whose products are getting long in the tooth and are prime targets for Oracle’s new offerings that are based on its platform called Fusion. You may recall that Fusion went GA (that’s general availability, not the mid-night train), more or less, at last year’s OpenWorld but it hasn’t exactly set the world on fire and there are persistent rumors that the stuff doesn’t work very well or that it requires a phalanx of consultants to make it do its tricks.

The big hurdle for Oracle therefore will be to convince the assembled multitude that Fusion is real and that the path to the future goes through the intersection of Fusion and Big Iron.

Speaking of big iron, last year the company rolled out some additional gear to complement its Exalogic computing devices. It seems this family of hardware is built and optimized for very big jobs involving terabytes of data gazillions of users. That’s exactly the kind of stuff the growing cloud computing movement might gobble up. Currently data centers are masses of commodity servers in racks running feverishly but without a layer of sophisticated management that would optimize their utilization and reduce costs.

There has been an interesting series of articles by James Glanz here and here in the New York Times over the last few days focusing on the power consumption and pollution caused by data centers. The pollution comes from diesel generators periodically fired up to test the centers’ ability to withstand a power interruption. The consumption is gargantuan.

But a bigger question, for which there are ready answers, asks why so much power demand? Part of the answer lies in how many companies are avoiding the necessary virtualization that will make the cloud much more efficient and sustainable. According to the Times and backed up by McKinsey & Company, which did the analysis, conventional data centers run many CPUs and disks at much less than capacity in part to cater to the urban myth of the need to keep one company’s data separate from another’s.

You’ve heard me on this before using the metaphor that we comingle our funds in banks and overlay the pool of deposits with metadata like account numbers and statements. Why are we resisting do this with data? Companies like Salesforce are already doing the same virtualization in the cloud and Oracle has an opportunity to strongly support virtualization and point to a more sustainable future.

Will it?

I’m going out on a limb to say yes. Maybe it won’t happen right away but keep in mind that two or three years ago Larry Ellison ridiculed the cloud and now that he has modern hardware and software he’s a big proponent. The next logical step would be to endorse the Exa-hardware as a sustainability tool for a power hungry planet. I’m looking for some sustainability messaging from Oracle and it could even happen.

This is not a digression. Sustainability is not alien to ideas like mobility, cloud, social and analytics, you can’t separate them. I think if Oracle wants to maintain its leadership position with many of the largest companies in the world, it needs to put a stake in the ground and become a thought leader here. The next decade in IT won’t be like the one that preceded it and if Oracle simply comes out with a grocery list for replacing old hardware and applications with more modern stuff it will be missing a great opportunity. At the end of the day people go to these conferences looking for new ideas and things they haven’t seen before. That’s what I’ll be watching for.

I am indebted to my friends at the Enterprise Irregulars, for the links in this piece. The IE’s, if you didn’t know, are a rag tag group of certified smarties who know all kinds of stuff about the greater tech industry and I am flattered that they let me hang out with them.

The aftermath of the verdict from the patent infringement lawsuit between Apple and Samsung initially generated more heat than light. But the last few days have made up for the light that failed to emanate from the weekend’s id fest and Armageddon prediction Internet confab.

I particularly recommend Perlow’s article because, while the idea of product dress might seem weird to some people — especially those who take issue with the look and feel aspects of the Apple suit — it might interest you to know that product dress is a legal term.

Without giving away Perlow’s point, let’s just make the observation that the classic Coke Bottle, which has nothing to do with how the stuff tastes, is part of Coke’s dress and its IP, as much as its secret recipe. Only Coke has Coke Bottles, for a good reason. So go read that article.

My point here, other than giving a shout out to the IE’s and trying to enlighten others, is that Apple might have, at least momentarily, hit on the only look and feel for mobile devices that will ever be widely accepted. Tapping, swiping, pinching — things that come natural not only to the members of our Genus but also our Family and, who knows, maybe even our Order — might be so hardwired into our beings that coming up with an alternative might be a waste of time. Holy$%^&Batman that might mean that Apple could end up owning the mobile UI and someday soon be in a position to make a few pennies on every Samsung or HTC device running Andriod for ever.

Believe it or not, such an outcome would not be unique in the annals of business or manufacturing. It might have something to do with cross licensing (I know, but don’t confuse it with dressing mentioned above). That’s when more than one company asserts ownership rights to an invention that each came up with the old fashioned way (you know, R&D?). But rather than fighting about it for years, the two (or more) companies come to terms, some money and possibly other patents are traded and then it’s back to business.

The best example of this is the car industry. Car radios, V-8 engines, automatic transmissions, how heating and air conditioning systems work, how the controls are set up and lots more, all have patents and if all cars look more or less alike in some basic features and functions, it might be because their makers went to the same patent swap meet. Yes, patents expire so don’t go looking to fund the fifth generation grand kids college even if you have lot of patents.

So this brings us back to Larry and Tim and the hotline. May we be informal for a moment and simply refer to each other using first names like they do in the music biz (Elvis, John, Paul, George, and especially Ringo; but also Bono, Sting, Eric and many others)? So, Larry bought Motorola (early car radio patents, BTW) at least in part for its stable of patents to ward off just the kind of suit that Tim’s company is making famous in the mobile industry (Tim should file a patent! hahaha!). And Larry, Tim and their minions are keeping the lines of communication open as they say.

What are the odds that the verdict put the discussions into high gear and that there’s an informal-formal patent swap meet happening out in the Valley between these principals? Nothing would surprise me but I think that if both sides remain reasonable and use their inside voices and big words, that there will be an announcement in the not too distant future that they’ve struck a deal.

If so, the deal would create the stack of the decade. Just as Wintel described a stack of Windows OS and Intel chips that made the personal computer; or as LAMP stands for Linux, Apache, MySQL and PHP for cloud application servers, some standard that combines Mobile/Google/Android/Motorola/Apple might emerge from all this chaos for mobile devices.

Let’s see, MOGAM? MOGA? GAAMMO? AGAMO? AAM? AA? Who knows, naming might be the stickiest part of the negotiations that aren’t happening on the hot line at the moment.